Rubber extended a rally to an eight- month high after a U.S. jobs report signaled a recovery in the world’s largest economy, boosting speculation demand will expand for the commodity used to make tires.
Rubber for delivery in June climbed as much as 1.9 percent to 313.7 yen a kilogram ($3,563 a metric ton) on the Tokyo Commodity Exchange, the highest since May 7. Futures traded at 310 yen at 10:40 a.m., extending this year’s gain to 2.5 percent.
U.S. employers added workers in December at about the same pace as in the prior month even as lawmakers struggled to reach a budget deal, the Labor Department’s monthly payrolls report showed Jan. 4. The report helped the dollar advance to the highest level since July 2010 against the Japanese currency, raising the appeal of yen-denominated contracts.
“The U.S. data added to optimism about economic recovery and raw-material demand growth,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said by phone today.
The yen traded near a 2 1/2 year low against the dollar amid speculation that Japan’s Prime Minister Shinzo Abe will ramp up efforts to spur growth, paring demand for refuge assets. The yen traded at 87.97 per dollar after touching 88.41 on Jan. 4, the weakest since July 2010.
Rubber for delivery in May added 0.3 percent to 26,440 yuan ($4,245) a ton on the ShanghaiFutures Exchange. Natural-rubber inventories gained 1,770 tons to 97,697 tons, the highest since March 2010, the bourse said on Jan. 4, based on a survey of nine warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin.
Thai rubber free-on-board advanced for a seventh day on Jan. 4, rising 1.2 percent to 102.10 baht ($3.35) a kilogram, according to the Rubber Research Institute of Thailand.
Source: Bloomberg
